DOW JONES NEWSWIRES PetSmart Inc.'s (PETM) fiscal third-quarter net income rose 22%, as the company's product mix helped it weather tough economic times and match its expectations.
The company also offered fourth-quarter guidance that brackets Wall Street expectations and lowered its 2008 earnings guidance.
Wall Street shrugged off the lowered guidance, helping the shares rebound 7.7% to $14.35 in after-hours trading. The shares were down 12% during the regular session.
"The unique blend of staples and discretionary items inherent to our business model has allowed us to manage through this challenging environment and deliver on our guidance for the quarter," said Phil Francis, chairman and chief executive. "But we are not immune to the pressures of a slowing economy."
The pet-food and -supplies chain posted net income of $35.8 million, or 28 cents a share, up from $29.5 million, or 23 cents a share, a year earlier.
Revenue for the quarter ended Nov. 2 rose 12% to $1.25 billion, with same-store sales increasing 5.4%.
In August, the company projected earnings of 25 cents to 29 cents a share.
Gross margin narrowed to 28.6% from 29.7%.
For the current fiscal year, the company lowered its earnings guidance to a range of $1.49 to $1.52 a share from the previous view, last affirmed in August, of $1.51 to $1.59 a share. Analysts polled by Thomson Reuters currently project $1.48 a share.
The company also said it expects total percentage sales growth in the high single digits, roughly in line with the 9% growth expected by Wall Street, and sees same-store sales rising in the low to mid-single digits, percentage-wise.
For the current quarter, PetSmart expects earnings of 59 cents to 62 cents a share and comparable-store sales percentage growth in the low to mid-single digits. Wall Street expects earnings of 60 cents a share.
"Our guidance assumes that current trends continue, including some inflation benefit on the top line, product margin pressure and ongoing expense leverage," Chief Financial Officer Chip Molloy said.
As a result of the slowing economy, the company plans to slow capital spending in 2009 and focus on execution in areas that differentiate PetSmart's products and services.
Analysts have worried that PetSmart's sales will suffer as consumers skimp on treats for their pets and big-box retailers such as Wal-Mart Stores Inc. (WMT) expand in the pets segment.
-By Jay Miller, Dow Jones Newswires; 201-938-2331; jay.miller@dowjones.com
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(END) Dow Jones Newswires
November 19, 2008 16:51 ET (21:51 GMT)

Publié le 19 novembre 2008 Copyright © 2008 Dowjones